A case of a sales contract dispute where a company from Lianyungang is suing a company from Yancheng, as well as individuals Chen, Zhang, and Wang.
Basic case:
On June 18, 2022, the plaintiff and the defendant signed two "Entrusted Procurement Contracts," agreeing on a total contract price of 6.17 million yuan, with a procurement commission of X yuan, for the defendant to procure 6 containers of white shrimp on behalf of the plaintiff. A few days after the contract was signed, at the request of the defendant, the plaintiff transferred the initial payment for the goods and the commission to the defendant's account in two installments. After receiving the plaintiff's payment and the procurement commission, the defendant solemnly promised to deliver the goods to the plaintiff by the end of November 2022 and committed to fulfilling the contract in its entirety before the end of November. However, the defendant failed to deliver the goods on time. According to Article 20 of the Civil Code and the Company Law of our country, if a company's shareholders abuse the independent status of the company and the limited liability of shareholders to evade debts, seriously harming the interests of the company's creditors, they should bear joint liability for the company's debts. The plaintiff believes that the actions of the defendant company and its shareholders have seriously harmed the plaintiff's legitimate rights and interests, causing the plaintiff mental suffering and significant economic losses, and that the defendant company and its shareholders should bear joint liability for the aforementioned actions.
Case handling:
Case Analysis:
According to Article 509, Paragraph 1 of the Civil Code, parties shall fully perform their obligations as agreed. According to Article 3, Paragraph 1 of the Supreme People's Court's Interpretation on Several Issues Concerning the Application of the General Principles of the Contract Section of the Civil Code of the People's Republic of China, if there is a dispute over whether a contract is established, and the people's court can determine the names or titles of the parties, the subject matter, and the quantity, it should generally be recognized that the contract is established. However, this is subject to other legal provisions or agreements between the parties. According to Article 3, Paragraph 1 of the Company Law (2018 Revision), a company is a legal person with independent legal property and enjoys legal property rights. A company is liable for its debts with all its property. The parties involved in the contract are a certain company in Yancheng and a certain company in Lianyungang, and both parties should perform their respective obligations according to the contract. According to Article 3, Paragraph 1 of the Company Law (2018 Revision), a company is a legal person with independent legal property and enjoys legal property rights. A company is liable for its debts with all its property. The parties to the contract are companies, which are corporate actions, and should be liable by the company. Company shareholders enjoy limited rights. The subject of the contract signed is a certain company in Yancheng, which is still in normal operation. The request by the certain company in Lianyungang for its shareholders Zhang, Wang, and Chen to bear joint liability has no legal basis.
Case outcome:
Court Ruling:
The People's Court of Yandu District, Yancheng City, Jiangsu Province ruled in the first instance to terminate the contract, requiring a certain company in Yancheng to refund the payment, and dismissed the other claims of the plaintiff, a certain company in Lianyungang.
The Intermediate People's Court of Yancheng City, Jiangsu Province ruled in the second instance to dismiss the appeal and uphold the original judgment.